When does sovereign immunity affect United States companies doing business with foreign enterprises?

(a): In some countries, notably China, state-owned enterprises act similarly to privately owned enterprises. If the state exercises control over such an enterprise to the point where it may be considered an “instrumentality” of that state, then the enterprise may enjoy sovereign immunity and be immune from suit. This should be considered when deciding whether to form a joint venture or otherwise dealing with a state-owned enterprise.

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